Why not to be a San Francisco landlord

At what point are lawmakers at the highest and lowest levels, going to realize that they are destroying any and all incentives to doing business in this country?

Edited: 06/26/2010 at 08:48AM

Joshua Dorkin, BiggerPockets, Inc.
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Michael Rossi

Real Estate Investor · Ohio

4587 posts
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Icon_minipost Jul 01 '09, 02:53 AM

At what point are lawmakers at the highest and lowest levels, going to realize that they are destroying any and all incentives to doing business in this country?

I thought they did know and were doing it intentionally. How else can they justify taking over all private business? I heard that Joe Biden wants to run BiggerPockets! It won't be the same without you Josh.

Mike

Edited: 06/26/2010 at 08:48AM

Corey Demuth

Real Estate Investor · Queens, New York

356 posts
1448 Influence
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Icon_minipost Jul 01 '09, 04:21 AM

Originally posted by Joshua Dorkin

At what point are lawmakers at the highest and lowest levels, going to realize that they are destroying any and all incentives to doing business in this country?

yeah, exactly. I tend to be very conservative about money; I even look at graduated income tax as and extremely stupid policy. Why on earth would you punish people for making more money? It's like when countries in the UN try to say they give more money than the US - because what they give equates to a higher percentage of their GNP than what the US gives as compared to their own GNP. But what they fail to acknowledge is that 10% of 1 million is still more than 99% of 1 thousand... I know I'm simplifying things but still.

Edited: 06/26/2010 at 08:48AM

Richard Warren

Real Estate Investor · Las Vegas, Nevada

1825 posts
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Icon_minipost Jul 01 '09, 07:24 AM

The movie Pacific Heights should be must viewing for any wanna-be landlord, especially one in San Fransicso. Tenants who understand the laws can take advantage of the system to the detriment of landlords. This is just another example of a system gone horribly wrong.

:cool:

Edited: 06/26/2010 at 08:48AM

Eddie Ziv

Real Estate Investor · Studio City, California

1803 posts
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Icon_minipost Jul 01 '09, 07:50 AM

If you think it's bad now, wait few years. When the trend of supplying "affordable housing" for home buyer is completely reversed, The power of renters is only going to get bigger and stronger. I'm afraid that the city by the bay will experience further drop in rental property prices.
.... And yes, Richard. "Pacific heights" is a must for any landlord, especially in San Fran.

Edited: 06/26/2010 at 08:48AM

Eric L.

SFR Investor · Omaha, Nebraska

31 posts
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Icon_minipost Jul 01 '09, 11:49 AM

I consider myself pretty well versed in economics, but I don't fully understand how this will effect their housing market and rental economy.

Wouldn't this drive away landlords in droves and in turn cut the supply of rentals available for the people this plans to protect?

Wouldn't the landlords that are left only accept wealthy tenants and not rent to the middle and lower classes?

Wouldn't that essentially mean more houses on the market and in turn drive down the price of housing?

Wouldn't that lead to more foreclosures?

Edited: 06/26/2010 at 08:48AM

Corey Demuth

Real Estate Investor · Queens, New York

356 posts
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Icon_minipost Jul 01 '09, 10:32 PM

one problem is, in my opinion, that there is a never-ending supply of idiot wannabe investors who will swarm in and pick up rental properties at low cost as they're being dumped by smart landlords who've had enough of the BS and want out.

Edited: 06/26/2010 at 08:49AM

NC Mark

Real Estate Investor · North Carolina

1086 posts
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Icon_minipost Jul 01 '09, 11:40 PM

Incredible article. Why would anyone in their right mind 'invest' in San Francisco?

What landlords need is a strong national lobby.

Edited: 06/26/2010 at 08:49AM

Joshua Dorkin

BiggerPockets Founder · Denver, Colorado

10621 posts
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Icon_minipost Jul 01 '09, 11:53 PM

Originally posted by NC Mark

What landlords need is a strong national lobby.

Hmmm . . . interesting idea. Lots of LLs here on BP. You guys want to start a lobbying group? :wink:

Edited: 06/26/2010 at 08:49AM

Kevin Yeats

Real Estate Lender · Fort Pierce, Florida

530 posts
5057 Influence
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Icon_minipost Jul 02 '09, 12:01 AM

Will Landlord be permitted (or will they require) to view the tenants annual 1040 or pay stubs or other proof of income?

Markets do adjust. Landlord find other ways of increasing the cash flow coming in or decreasing their expenses (deferred maintenance). One market adjustment is for existing Landlords to exit the market, leaving less experience Landlords to deal with the new restrictions. Other owners could convert some housing inventory to other uses.

Edited: 06/26/2010 at 08:49AM

NC Mark

Real Estate Investor · North Carolina

1086 posts
7096 Influence
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Icon_minipost Jul 02 '09, 05:35 AM

Most disturbing to me is the apparent unconstitutionality of San Francisco dictating changes in existing leases.

Article I, section 10, clause 1 of the United States Constitution specifically states that "No State shall â€¦ pass any Law impairing the Obligation of Contracts."

But hey, this must be the "Change We Can Believe In".

Edited: 06/26/2010 at 08:49AM

Eddie Ziv

Real Estate Investor · Studio City, California

1803 posts
12555 Influence
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Icon_minipost Jul 02 '09, 05:42 AM

Kevin wrote:
"Landlord find other ways of increasing the cash flow coming in "

What a Nobel idea... Hey tenant, remember that parking space you've got for free? Guess what, it's now $40 per month. Also, the storage space ( The detached garage in SFR), this is another $25, sorry, I feel your pain. Oh, yes, almost forgot, your pet which had only initial additional deposit? Now $15 a month too. Oh and by the way, if you don't like it, why won't you right to your congressman... Uh?

Edited: 06/26/2010 at 08:49AM

Michael Rossi

Real Estate Investor · Ohio

4587 posts
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Icon_minipost Jul 02 '09, 07:09 AM

We have a lobbying group, at least here in Ohio. In Ohio, the state REIA (OREIA) has a lobbyist that has been somewhat successful in working with the legislature to stop these stupid laws. In addition, the REIA works with the big apartment associations and Realtors when there is common ground.

It sounds like California investors need to get their act together!!! It's time for them to start fighting the socialists.

Mike

Edited: 06/26/2010 at 08:49AM

James Hiddle

Real Estate Investor · Altus, Oklahoma

2515 posts
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Icon_minipost Jul 02 '09, 07:56 AM

Originally posted by MikeOH

We have a lobbying group, at least here in Ohio. In Ohio, the state REIA (OREIA) has a lobbyist that has been somewhat successful in working with the legislature to stop these stupid laws. In addition, the REIA works with the big apartment associations and Realtors when there is common ground.

It sounds like California investors need to get their act together!!! It's time for them to start fighting the socialists.

Mike

We all need to fight the socialists.

Edited: 06/26/2010 at 08:49AM